Professional development opportunities are vital to motivating and retaining top salespeople, according to a survey released today.
Conducted by the Sales Management Association and sponsored by cloud-based incentive compensation firm Xactly
, the survey found that the need for professional development -- including coaching and training opportunities --- is the top reason sales people leave companies, even ahead of better pay.
"The survey findings validate that you need more than compensation to attract, retain, and keep your sales reps performing successfully," said Steve De Marco, vice president of worldwide sales and alliances for Xactly Corporation. "While compensation remains a priority, today's companies must also invest in the professional development of their salespeople to reduce sales turnover and get reps to productivity faster."
This emphasis on the need to incorporate coaching and training opportunities into sales incentive compensation programs mirrors the findings of the landmark Participant Study
released in late 2015 by the Incentive Marketing Association
(IMA) and the Incentive Research Foundation
The Participant Study focused on whether cash or non-cash awards - including incentive travel, merchandise, and gift cards -- were preferred when looking at the "total award experience." When paired with the type of non-cash award preferred by each participant, it found that non-cash awards were more desirable. But, it also looked at how factors other than the award itself affected participants' preferences, and found professional development played a very large role. In sales incentive programs with large awards, the award itself only drove 48 percent of that preference, while professional development accounted for fully 32 percent, followed by how it is communicated (12 percent) and the recognition attached to it (9 percent).
While the effectiveness of cash versus non-cash awards remains a hot topic, it is important to note that the cash incentives referred to by the IMA/IRF study does not refer to the base commission structure -- also called the incentive compensation program -- but to incentive awards over and above that base. And one of the first things anyone experienced in the incentive industry will tell someone new to running sales incentives is that, no matter how spectacular the trip or generous the merchandise catalog is, if the sales compensation package isn't competitive, the awards don't matter and the program won't work.
Xactly also noted in an infographic
that survey respondents said that only one in five of their new sales hires over the past 24 months was successful, and that firms that are effective at training, coaching, and development achieve their sales objectives 17 percent more than non-effective firms.
The company added that it takes an average os 12 months for a new salesperson to ramp up to full productivity, and costs an average of $115,000 to replace a sales rep.